Determining an economic production quantity under a zero defects policy

This study considers a production system that shifts randomly from an in-control state to an out-of-control state, where, when the system is out of control, it has a larger probability of producing a nonconforming product than it does in an in-control state. A zero defects policy is reached by inspecting all products at a non-negligible inspection time. The inspection information is used to monitor the process quality in order to determine whether to cease production. To achieve a minimal cost per conforming product, a decision rule is provided for deciding when to cease production using the previous product inspection information or to determine an optimal production batch size when on-line product inspection is infeasible. Numerical examples are given to illustrate our proposed model. Sensitivity analysis using the model parameter values was also performed in order to understand the effect of the changes on the model’s variables, where it is shown that a smaller manufacturing variation achieves a smaller expected total cost per conforming product. Finally, a conclusion, including some future research directions, is provided.